DryShips rocketed the last two days from 5 to 9.45 on 27 million shares Monday and 73 million shares yesterday. There is only 44 million shares outstanding, but this stock was driven down by massive unreported short selling and a collapse in the Baltic Dry Index of freight.
Then news that China was going to have an early settlement on iron ore shipping costs drove the stock higher. If China wanted the new contracts to start in January instead of April, didn't anybody think that China was trying to game shipping costs? So the game was up for those that shorted this number.
But the same game was played by Goldman Sachs a few weeks back when they warned the world that Insurance companies were on the verge of an imminent collapse. Hartford Financial was sitting down at $5, and after a couple weeks down there, then announced they would earn between $4 and $5 for 2009, Goldman Sachs analysis be damned.
The stock tripled from it's lows, and doubled from last Thursday to Friday on 119 million shares.
Both these stocks had stories floated that weren't true, but the sheep sold them down anyway. Does anybody think it's any different for those talking up the next "depression"?
Now we see the collapse of oil prices, with the same bozo's who said oil was going to $200 when it was $140, now say it's going to $30 when it's at $42.
Let them talk, just buy the Powershares Double Crude ETF (DXO 2.75). If oil is going to collapse, why the huge contango in the futures market?
Oh that's right. It's the same when we had an inverted yield curve 18 months ago. We had officials at the Fed saying that didn't indicate a recession. Where they right?
Now are the futures wrong?
The shorts had their way when the hedge funds were puking up all of their stocks.
Now it's the bulls turn to run.
And look at Freeport-McMoran Copper (FCX 19.80) again. This stock wouldn't fall in yesterday's 250 move down. It was sold by those who had to own a dividend paying stock.
The selling is over in this number also.
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